Takata Airbag Bankruptcy Update

Takata sold defective airbags for years. We believe the Japanese airbag supplier knew its products were defective at least as early as 2002 or 2004. There is evidence that they falsified test data and discussed how to cover their tracks. The right thing to do would have to alert regulators and dealers and warn the public. Instead, they chose to cover up problems, quietly settle claims and keep raking in millions of profits.

By 2008, car makers were beginning to figure things out. Some did took the high road and started recalling cars while folks at companies such as VW kept installing dangerous Takata made airbags as late as 2017.

The charade is over. Federal prosecutors have come down hard on Takata. So have dealers, auto manufacturers, airbag injury victims and the estates of the many who have been killed by exploding airbags. Takata folded its tent in 2017 and filed bankruptcy.

Takata Bankruptcy Update

It appears the company has $1.6 billion in assets but that really isn’t all that much. Takata said in 2016 that the cost of a recall could be as high as $24 billion. And that was two years ago… as late as January 2018 millions more cars have been recalled.

Even if they had the money – and they don’t – Takata already owes Uncle Sam almost $1 billion dollars. And don’t think that every unhappy dealer that gets sued by a customer isn’t looking to Takata to be made whole. There simply isn’t close to enough money to go around.

Recently U.S. Bankruptcy Court Judge Brendan L. Shannon approved a preliminary plan that would allow airbag victims and creditors to participate in a trust. The trust would aggregate the money from the sale of Takata’s business and pool the money. The car makers that sold cars with Takata airbags would also contribute to the trust.

Personal injury victims would either have to accept a piece of the trust’s assets or opt out of the plan. If they opted out, they would most likely be seeking money from the car makers as they are the only parties with deep pockets and sufficient insurance to pay claims.

A federal judge in Michigan has appointed a special master to oversee how payments are made from the fund.

Most of the money in the fund will come from Key Safety Systems, a Sterling Heights (MI) company that has sought to purchase Takata’s operations. For $1.588 billion. They are buying all of the business except for the ammonium nitrate airbag inflator business. No one wants that segment of the company.

“I Was Injured Because of a Malfunctioning Takata Airbag, What Should I Do?”

Unfortunately, hundreds of people have reported being hurt because of malfunctioning Takata airbags. 21 have reportedly died from those injuries. We have heard from several airbag injury victims and all are confused as to what they should do. Their confusion is well placed.

The Takata bankruptcy case is still in its infancy. And it is highly contentious. After just 7 months there have already been over 1900 pleadings filed in the case. Complaints, motions, arguments about who should get what.

We still don’t know how that will play out, but it appears the pot of money to pay creditors will be about $1.6 billion. Where personal injury victims stack up against the claims of automakers, car dealers and government fines remains to be seen. We do believe, however, that any trust set up for injury victims will be grossly underfunded. There just isn’t enough money to go around. Remember too that the Takata bankruptcy estate owes car companies for the costs of the recall and the claims of millions of vehicle owners who say their cars are worth less because of the airbags and the nonavailability of replacement parts.

Whether or not you should opt out of the bankruptcy trust fund and fight your claim separately is a difficult decision. There is no “one size fits all” answer. The year and make of the vehicle is an important factor. It’s important because the automakers are well insured and can be held liable for defective parts, especially If they knew the airbags were dangerous.

If you were injured in a crash and believe your injuries were caused by a defective airbag, call us. We can help you determine if you have a case, what your case is worth and whether you will do better to make a claim through the Takata bankruptcy compensation fund or sue the automakers for knowingly installing cheap, defective airbags in their cars.

Why Are Takata Airbags So Dangerous

To answer this question, some knowledge is needed about automobile airbags. Designed to go protect occupants of the vehicle in a crash, airbags are supposed to inflate within the blink of an eye and prevent whiplash, ejection or slamming one’s head through a windshield or side window.

The airbag system has three main components, a sensor, actuator and the airbag itself. None of the parts are visible until there is an accident and even then, only the airbag is visible.

The sensor is the unit that detects a sudden forceful impact. It then sends an electronic signal to the actuator. The actuator is a canister that contains a propellant. The electronic signal releases the propellant which then rapidly inflates the bag.

Until 2001, Takata used a propellant called tetrazole. That year, however, the company realized it could “save” significant money by switching propellant. Instead of tetrazole, the company began filling the actuator canister with ammonium nitrate, the same compound that Timothy McVeigh used to bomb the federal building in Oklahoma. City.

Not only is ammonium nitrate dangerous, it is unstable. It is especially unstable after being exposed to high heat and humidity. Professor Paul Worsey, an explosives and mining expert at Missouri University of Science and Technology, told the New York Times that ammonium nitrate “shouldn’t be used in airbags. He acknowledged however, that “its cheap, unbelievably cheap.”

Another case of profits over people. Takata and the car makers who used their airbags wanted to save a few bucks, Now there are hundreds if not thousands of people dead, disfigured or seriously injured as a result of the actuator becoming a grenade. Instead of inflating the airbag, some Takata airbag inflators turn the metal actuator canister into a grenade and shoot sharp metal shrapnel into the head and face of drivers and passengers.

Maybe the car companies didn’t know the dangers at first, but they are still responsible for what gets installed as original equipment in their cars.

Takata Airbag Personal Injury Lawyers

Mahany Law is aggressively representing dozens of victims of defective Takata airbags. If you or a loved one suffered a serious injury or death from an exploding airbag, contact our Takata Airbag Injury team today. We are a national boutique law firm with cases in over 30 states. We are the leading law firm in airbag recall, airbag injury and death cases.